Multilateralism June 2021-

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Multilateralism 2018-June 2021
The Bretton Woods Project is a UK-based NGO
that challenges the World Bank and IMF

The Room Where it Happens: A Policy Q&A with Veteran G7 Sherpa Sen. Peter Boehm
As the world recovers from the health, economic and broader societal impacts of the COVID-19 pandemic, G7 leaders will be gathering in Cornwall, UK, June 11-13. During his career as a senior diplomat, Senator Peter Boehm, who now chairs the Senate Committee on Foreign Affairs and International Trade, served as Canada’s Sherpa for six G7s, including the G7 Charlevoix in 2018. Policy Associate Editor Lisa Van Dusen conducted a Q&A with Senator Boehm by email ahead of the Cornwall G7.

Global Tax Overhaul Gains Steam as G20 Backs New Levies
The approach marks a reversal of years of economic policies that embraced low taxes as a way for countries to attract investment and fuel growth.
(NYT) Global leaders on Saturday agreed to move ahead with what would be the most significant overhaul of the international tax system in decades, with finance ministers from the world’s 20 largest economies backing a proposal that would crack down on tax havens and impose new levies on large, profitable multinational companies.
If enacted, the plan could reshape the global economy, altering where corporations choose to operate, who gets to tax them and the incentives that nations offer to lure investment. But major details remain to be worked out ahead of an October deadline to finalize the agreement and resistance is mounting from businesses, which could soon face higher tax bills, as well as from small, but pivotal, low-tax countries such as Ireland, which would see their economic models turned upside down.
See also  Joseph E. Stiglitz: The Global Tax Devil Is in the Details
(Project Syndicate) The current average official rate is considerably higher. It is thus possible, even likely, that the global minimum will become the maximum rate. An initiative that began as an attempt to force multinationals to contribute their fair share of taxes could yield very limited additional revenue, much lower than the $240 billion underpaid annually. And some estimates suggest that developing countries and emerging markets would also see a small fraction of this revenue.Preventing this outcome depends not just on avoiding a downward global convergence, but also on ensuring a broad and comprehensive definition of corporate profits, such as one that limits deduction for expenses relating to capital expenditures plus interest plus pre-entry losses plus… It would probably be best to agree on standard accounting so that new tax-avoidance techniques do not replace the old ones.
Particularly problematic in the proposals advanced by the OECD is Pillar One, intended to address taxing rights, and applying only to the very largest global firms. The old system of transfer pricing was clearly not up to the challenges of twenty-first-century globalization; multinationals had learned how to manipulate the system to record profits in low-tax jurisdictions. That’s why the United States has adopted an approach whereby profits are allocated among the states by a formula that accounts for sales, employment, and capital.

7 July
Transnational governance of natural resources for the 21st century
Rabah Arezki
(Brookings) Today’s scramble for natural resources by major powers is far from new. It stems from a long-standing and fundamental asymmetry between advanced and less-advanced economies—not only in terms of access to and demand for natural resources, but in terms of advances in technology, military might, and state and private sector capabilities in general.
… Several international initiatives have focused mainly on transparency. They include the Extractive Industry Transparency Initiative and the Natural Resource Charter. A number of NGOs have been very active in the space. Legislation in the United States and the European Union (EU) strive to hold accountable their multinational corporations by mandating that those companies disclose their payments in countries in which they operate. It is more difficult to hold state-owned enterprises accountable because of a lack of transparency and a complex web of interests and cross-subsidies. The development of environment, social, and corporate governance norms (ESG)—with roots in the socially responsible investing movement that began in the 1970s—are means by which investors and others can gauge how responsibly a corporation behaves environmentally. But it is unclear whether ESG assessments are sufficient to force firms to internalize the complex sets of externalities at different levels required to achieve sustainable behavior. It is also unclear whether and how these norms could be enforced.

15 June
Summit Season and the Return of Multilateralism (podcast)
Jeremy Kinsman and Ambassador Thomas Pickering, U.S. Ambassador and Representative to the United Nations in New York under President George H.W. Bush, U.S. Under Secretary of State for Political Affairs under President Bill Clinton. He holds the personal rank of Career Ambassador, the highest in the U.S. Foreign Service. Hosted by Colin Robertson, former diplomat, Vice President of the Canadian Global Affairs Institute.
The International Order Didn’t Fail the Pandemic Alone
The United States and China Are Its Crucial Pillars
By Thomas R. Pickering and Atman M. Trivedi
(Foreign Affairs) The institutional and political vulnerabilities that COVID-19, the disease caused by the novel coronavirus, has exposed in multilateral organizations are real. But to blame such vulnerabilities on a lack of effort or expertise in the institutions themselves mistakes the symptom for the cause. At the heart of the problem is the failure of the world’s leading powers, starting with the United States and China, to invest in and empower the multilateral system. Washington’s sins of omission and Beijing’s sins of commission have conspired to sideline international institutions, helping frustrate their common goal of ending the pandemic. (14 May, 2020)

15 June
Quoting Irish poet, Biden ends EU trade war in renewal of transatlantic ties
(Reuters) – U.S. President Joe Biden ended one front in a Trump-era trade war when he met European Union leaders on Tuesday by agreeing a truce in a transatlantic dispute over aircraft subsidies that had dragged on for 17 years.
The EU also lifted its tariffs on U.S. steel and aluminium for six months in the hope that the United States will do the same for Europe.

14 June
NATO takes tough line on China at first summit with Biden
(Reuters) – NATO leaders warned on Monday that China presents “systemic challenges,” taking a forceful stance towards Beijing in a communique at Joe Biden’s first summit with an alliance that Donald Trump openly disparaged.
The new U.S. president has urged his fellow NATO leaders to stand up to China’s authoritarianism and growing military might, a change of focus for an alliance created to defend Europe from the Soviet Union during the Cold War.
The language in the summit’s final communiqué, which will set the path for alliance policy, came a day after the Group of Seven (G7) rich nations issued a statement on human rights in China and Taiwan that Beijing said slandered its reputation.
Biden also told European allies that the alliance’s mutual defense pact was a “sacred obligation” for the United States
Colin Robertson: Canadian Primer to the NATO Summit in Brussels June 14, 2021
(CGAI) Presidents and prime ministers of the thirty NATO nations will meet in Brussels on Monday, June 14. The agenda, for this their 29th summit since the Alliance was formed in 1949, will discuss safeguarding the rules-based order in the face of the rising challenge from China and Russia. NATO operations in Afghanistan and Iraq will also be discussed.

11-13 June
G7 Leaders Offer United Front as Summit Ends, but Cracks Are Clear
Biden and other Western leaders had tough words for Russia and China after wrapping up a meeting in England, but they had trouble finding common ground on some big issues.
(NYT) President Biden and fellow Western leaders issued a confrontational declaration about Russian and Chinese government behavior on Sunday, castigating Beijing over its internal repression, vowing to investigate the pandemic’s origins, and excoriating Moscow for using nerve agents and cyberweapons.
Concluding the first in-person summit meeting since the outbreak of the coronavirus pandemic, the leaders tried to present a unified front against a range of threats. But they disagreed about crucial issues, from timelines for halting the burning of coal to committing tens or hundreds of billions of dollars in aid to challenge Beijing’s Belt and Road Initiative, China’s overseas investment and lending push.
Biden urges G-7 leaders to call out and compete with China
(AP) — Leaders of the world’s largest economies unveiled an infrastructure plan Saturday for the developing world to compete with China’s global initiatives, but there was no immediate consensus on how forcefully to call out Beijing over human rights abuses.
Citing China for its forced labor practices is part of President Joe Biden’s campaign to persuade fellow democratic leaders to present a more unified front to compete economically with Beijing. But while they agreed to work toward competing against China, there was less unity on how adversarial a public position the group should take.
Angela Merkel, Anchor of European Stability, Stays Focused at Her Final G7
The German chancellor, known for her commitment to compromise, is eager to revive deal-making on multilateral policy, joining the world’s top democratic leaders one last time. Can she be replaced?
European Union, U.K. Brexit spat over Northern Ireland clouds G7 summit
(AP via Global) The two sides are locked in an escalating diplomatic feud over Northern Ireland, the only part of the U.K. that has a land border with the bloc. The EU is angry at British delay in implementing new checks on some goods coming into Northern Ireland from the rest of the U.K. required under the terms of Britain’s divorce from the bloc. Britain says the checks are imposing a big burden on businesses and destabilizing Northern Ireland’s hard-won peace.
G-7 pledge to share, but jostle for ground in the sandbox
Recovery from the pandemic was set to dominate their discussions, and members of the wealthy democracies club committed to sharing at least 1 billion vaccine shots with struggling countries. That includes a pledge from U.S. President Joe Biden to share 500 million doses, and a promise from Johnson for another 100 million shots.
G7 summit: Biden, Johnson to reaffirm bond but tensions simmer
On the eve of the G7 summit, the US leader is expected to warn his UK counterpart over Brexit-related frictions in Northern Ireland.
(Al Jazeera) British Prime Minister Boris Johnson and United States President Joe Biden are expected to reaffirm the relationship between their two countries on the eve of the G7 summit, despite warnings from Washington over simmering Brexit tensions.

7 June
The G7 Cornwall: Back to Normal, with Key Upgrades
Colin Robertson
(Policy) This coming weekend, the leaders of the advanced economies and leading democracies will meet at the Carbis Bay Hotel in a tiny Cornish seaside village in Britain’s most southerly county. While the agenda has evolved annually since its creation in 1975 (Canada joined in 1976) in the wake of the oil shock crisis, the G7 leaders have had two overriding priorities: strengthening the global economy and bolstering the rules-based order.
For this meeting, host British Prime Minister Boris Johnson has also invited the leaders of, India, Australia, South Korea and South Africa to Carbis Bay. Together, the 11 leaders represent almost two-thirds of the people living in democracies around the world.
The leaders meet against a challenging backdrop. In a signed statement released June 3rd and titled Our Planet, Our Future: An Urgent Call to Action to the G7, 126 Nobel laureates called on the leaders to commit to “a new relationship with the planet” recognizing that this decade will be “decisive” in determining whether the Earth remains habitable.
As host, PM Johnson has set a high bar, declaring that “as the most prominent grouping of democratic countries, the G7 has long been the catalyst for decisive international action to tackle the greatest challenges we face.” Johnson wants to ‘build back better’ from the pandemic by:
leading the global recovery from coronavirus while strengthening our resilience against future pandemics; promoting our future prosperity by championing free and fair trade; tackling climate change and preserving the planet’s biodiversity; championing our shared values. A primer to the 2021 Summit

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